Amazon profits down in Q4 despite sales rise

Amazon warns profits down despite sales growth in Q4 and FY2011

Tags: Amazon.com Incorporated
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Amazon profits down in Q4 despite sales rise Amazon has seen strong demand for the Kindle, but investment has cut into profit, says Bezos. (Getty Images)
By  Mark Sutton Published  February 2, 2012

Amazon has warned that its profits dropped for Q4 and financial year 2011, despite increases in sales.

Net income dropped 58% in Q4 to $177 million from $416 million in same Q10, while annual income was down 45% to $631 million for the full fiscal year.

Sales were up in the fourth quarter, to $17.43 billion, a rise of 41% year-on-year, and net sales were also up for FY2011, by 41% to $48.08 billion.

Amazon said that it saw strong growth in its Kindle business, where sales of the device tripled in Q4, and in its video services. However, the company said that with ongoing investment in areas such as building out data centres, fulfilment centres and its Kindle device business, it was likely to continue to see income down.

"We are grateful to the millions of customers who purchased the Kindle Fire and Kindle e-reader devices this holiday season, making Kindle our bestselling product across both the U.S. and Europe," said Jeff Bezos, founder and CEO of Amazon.com. "Our millions of third-party sellers had a tremendous holiday season with 65% unit growth and now represent 36% of total units sold."

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